Agencies shifting information technology dollars to Y2K

Congress will be facing a large "pent-up" demand for new IT funding after 2000 because federal agencies have been diverting so much money from their information technology budgets to focus on the Y2K problem, the General Accounting Office warned the Senate Y2K Committee Tuesday.

"Another less direct but undeniable issue associated with the Year 2000 challenge has been the postponement of many program and information technology initiatives so that resources could be dedicated to Y2K. Such demands, including system enhancements and computer security, have not vanished; in fact, they have grown," said David Walker, comptroller general at the General Accounting Office, at a hearing of the Senate's Special Committee on the Year 2000 Technology Problem.

Costs of fixing the government's Y2K problem have escalated to about $8.7 billion, estimates the GAO. Congress allocated $3.3 billion to help the agencies fix the problem, but any further money has to be found in agency IT budgets, and the GAO argues that the diversion will have to be replaced in future appropriations budgets.

On the other hand, OMB director Jacob Lew argued that because of the Y2K problem, agencies have been forced to update their systems and buy new equipment so the "pent-up" demand for new systems may not be as large as the GAO fears.

"There are more agencies with modern computers because of Y2K ... we are left with a better architecture because of Y2K," Lew said.